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Private property cannot be taken without just compensation

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For more than five decades, Ethiopia has carried one of its most unresolved urban injustices: the nationalization of private houses under Proclamation No. 47 of 1975. What began as a revolutionary measure under the Derg has remained an open wound for thousands of property owners in Addis Ababa and other cities who say they were never properly compensated for what the state took from them.

The issue is not difficult to understand. If a government takes private property for public use, it must pay just compensation. That is a basic principle of fairness and a cornerstone of any lawful property system. Yet in Ethiopia, many old government houses were not built by the state. They were built by private citizens, then transferred to government ownership under a law that promised compensation but failed to deliver it. Fifty years later, that promise still has not been honored.

That failure matters because property rights are not a minor technical matter. They are tied to dignity, security, inheritance, investment, and trust in government. When people build houses with their own labor and resources, they do so with the expectation that the law will protect what they have created. When the state later takes those homes and keeps collecting rent without settling the original claim, the result is not just legal confusion. It is injustice.

Proclamation No. 47 of 1975 nationalized so-called “extra houses”, Urban buildings and transferred ownership of urban rental properties to the government. It also forced owners to register and hand over those houses within 30 days. The law abolished the private landlord-tenant relationship and replaced it with state control through the Ministry of Public Works and Housing or urban cooperatives. In return, it expressly promised fair compensation.

That compensation was never fully paid.

Instead, the government continued to collect rent from the houses for decades. In effect, it benefited from the very property it had taken while leaving the original owners waiting for payment that never came. That is the heart of the dispute, and it remains unresolved today.

The problem became even more complicated because the law did not clearly define the full size or structure of a dwelling house. As a result, in some cases, part of a private home was classified as an “extra house” and taken by the state. That meant some owners were left living in their own houses together with government tenants or lessors, often for decades and against their will. In practical terms, the state did not only take buildings. It also disrupted households, split property use, and reduced the land available to original owners for their own dwelling purposes.

This is not a small administrative mistake. It is a long-term violation of property rights and personal dignity.

The impact goes beyond ownership papers. Housing is where families live, grow, and pass on wealth. If part of a private home is taken and turned into government property without compensation, the owner loses more than a room. They lose control, privacy, income, and often the ability to use the remaining land properly. That is why many owners have continued to seek justice for decades. Their claim has never been just about money. It has been about restoring what was taken unfairly.

There have been some attempts to correct the problem. Under the EPRDF, extra houses were returned to true owners in Tigray, showing that the injustice could be addressed when political will existed. That was an important step and should have been a model for wider reform. But outside that example, the problem was never fully solved. In many cities, including Addis Ababa, the old ownership dispute was left hanging.

The current Prosperity Party-led government has also not resolved the matter. In some cases, it has made it worse by demolishing older government houses in the name of corridor development without first settling the compensation issue. That approach is deeply troubling. Development is necessary, but development cannot be used to erase legal obligations. A city can be modernized without violating the rights of the people who built its neighborhoods in the first place.

The government’s position appears to rest on the idea that these houses became state property long ago and therefore belong permanently to the state. But that argument ignores the central promise of Proclamation No. 47 of 1975 Article 18(1): compensation. If the state took ownership on the condition that it would pay fair value, and that payment was never made, then the moral and legal debt has not disappeared. Time does not erase an unpaid obligation. It only makes the failure more serious.

This is why the issue must be treated as more than a historical dispute. It is a live question of justice. The government cannot continue collecting rent for decades, demolishing houses in the name of development, and still claim that the original owners have no standing. If compensation was promised and never paid, then the owners still have a legitimate claim.

The solution should begin with recognition. The government should openly acknowledge that many private owners were never fairly compensated for extra houses taken under the 1975 law. It should also acknowledge that some owners were deprived of rooms inside their own dwellings and of the land they were supposed to use for housing. These are not imaginary grievances. They are concrete losses that have affected real people for generations.

Second, the state should restore property where restoration is still possible. In cases where parts of a dwelling were wrongly classified as extra house space, the original owners should be given back what was taken, if it can be returned without causing new injustice. Where that is no longer possible, fair compensation must be paid. That is the basic balance required by law and ethics.

Third, any urban development program, including corridor projects and demolition plans, must begin with a proper compensation framework. It is not enough to say that a structure is old or outdated. If the government is still benefiting from property that was never fully paid for, then it has no moral authority to demolish it as though the debt never existed.

The principle here is simple but powerful: private property cannot be taken for public use without just compensation. That principle should apply whether the property is a house (either Normal rectangular block or Villa House), a room, a building or a parcel of urban land. It should apply whether the taking happened yesterday or 50 years ago. And it should apply whether the government is building roads, corridors, or public facilities.

A government that respects the law must also respect the people whose labor, savings, and sacrifice built the homes it now controls. Urban renewal should not mean historical amnesia. Development should not mean dispossession. Modernization should not be built on unpaid debts.

Ethiopia has an opportunity to correct a long-standing wrong. Doing so would not weaken development. It would strengthen legitimacy. It would show that the state can grow cities without erasing the rights of its citizens. It would show that law means something even when decades have passed.

If Ethiopia wants a truly modern urban future, it must begin by settling the old one fairly. That starts with a simple commitment: private property cannot be taken for public use without just compensation.

The clock and the canopy

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In July 2026, after a series of bureaucratic delays that pushed its schedule to October, the Ethiopian National Dialogue Commission hosted the Ethiopian National Dialogue Forum, a massive gathering of more than 4,000 delegates from 1,200 districts convened in cooled conference rooms to tackle some of the country’s most intractable political problems. On paper alone, in the logistical organization of 55 structured speaking sessions and more than 1,100 side events, the forum seems a remarkable feat, an operation of crushing scale. Yet behind closed doors, a more subdued struggle is taking place. It is not one of guns and munitions, but of visions: a direct clash between two entirely distinct conceptions of time, of truth, and of the very act of restoring a fractured nation.

On one side is the state-building playbook: highly bureaucratic, document-oriented, legally driven, and strictly time-bound, all packaged rigidly by Proclamation 1265/2021. It is a world of lawyers and legal prose. On the other side is the time-honored, relational, social-linguistic matrix of Ethiopia’s oral customary laws, the projection of the shadow of the sacred sycamore tree. In this world, peace has nothing to do with signing documents and voting for policies; it is something slow and deliberate, a laborious effort to repair damaged relationships.

The real test of this dialogue becomes a huge translation challenge. As much as the Commission may want to reenact and incorporate the revitalizing, holistic spiritualities of reconciliation embodied by the ancestors, it must still translate such ancestral accords into the closed, bureaucratized box of a modern state. How Ethiopia manages this polarization will probably decide whether the summit results in a real, long-lasting social contract or instead another magnificently crafted and never-implemented government report.

To see where the gears are grinding, one must look at the form the process takes. The Commission is institutionally independent of government, outside the executive, legislative, and judicial branches. Its design is straightforward and sequential: collect themes emerging from the ground up, discuss them regionally, distill the results into a concise rundown of topics to be discussed nationally, and, just before the forum in July, organize these into eight thematic pillars, including national identity; structure and authority of the federal government; religious pluralism; human rights; and reconciliation after conflict.

The challenge is that centuries of history, misery, and grievance cannot be neatly frozen into bullet points and then euphemistically “rationalized” for voting by delegates in timed sessions. Yet as the massive bureaucratic machine moved out of the capital into the highland plains, riverine valleys, and pastoral hilltops, it repeatedly came face to face with vastly different indigenous justice systems, entire worlds of their own, tuned to a very different note. For many Ethiopians, peace is not a bargain settled by rival political elites. It is the re-establishment of cosmic and social harmony.

Take, for example, the Oromo Gadaa system, which has governed community life for centuries. At its core is the Abbaa Gadaa, a traditional orator who presides over arenas where conflicts are arbitrated. Under the Oda, or sacred fig, tree, elders sit and speak, but there is no majority vote producing winners and losers. Rather, the participants keep talking for weeks, sometimes until they reach absolute consensus. Together with them is the Hadha Siiqqe, an institution of mediating women who, with spiritual and moral authority, step between the factions and, in one motion, freeze the conflict and set in motion the slow mechanics of reconciliation.

The Sidama model is conceptualized in much the same way. Invoked by a council of elders called the Cimeessa, the Afini is a deeply patient, restorative process that actively discourages participation by the wealthy or powerful and elevates compromise above all else. Idle assemblies are held where people speak their minds, they say, no matter how much it costs in respect. The community then works carefully to persuade the offender to admit guilt. Once shame is fully understood, the elders decide how much compensation will repair the damage, almost always in cattle. Finally, through a cycle of nourishment and prayer, forgiveness is delivered, first through sacred speech and then during a communal meal.

You find these same Indian Ocean concepts tucked away in every corner. Foresters in the Abar and Aften forests settle land and water conflicts through the Moabalo. In the Shabei plain, the Ogaden nomads use the Heer system, an oral pact that clans uphold for restitution, so that blood-feud rituals can end forever. In the north, the Afar and the Amhara turn to the Shimbaln, where dynastic elders, respected in their communities, use personal authority to bargain forgiveness and accommodation. None of these traditional fixes seeks instant solutions, top-down treatment, or punitive measures that dismantle the community fabric in the name of speedy state administration.

Historically, peace processes have broken down when such realities have been ignored. The most renowned transitions — whether in Poland in 1989 or South Africa in the early 1990s — were elite-driven negotiations that helped forestall crises. In both cases, negotiators managed to overhaul constitutional rules and avoid civil war. But because of their focus on elite bargains, they often neglected the psychological and relational scars borne by ordinary people.

Worse still, when formal peace processes become utterly disconnected from local realities, the consequences can be disastrous. The Yemeni national dialogue held in the early 2010s was highly praised by the international community for its structure and inclusion of women and youth. However, since the formal negotiations in Sana’a were entirely disconnected from the tribal arrangements that controlled ground security, the agreements collapsed and the country descended into civil war. The same logic applies to Colombia, where the government and FARC militants spent years negotiating a technically polished peace accord in Havana, only for it to be rejected by Colombian voters in a referendum. It was a vivid reminder that an agreement lacking popular ownership has no weight.

Ethiopia will therefore have to navigate a complex path to avoid these mistakes. The National Dialogue Commission will have to strike a difficult middle ground: it cannot adopt a structure modeled entirely on international templates from South Africa or Europe, nor can it neglect the administration of a modern state. It must forge a hybrid peace architecture.

The launch of the National Dialogue Forum in July 2026 has brought those tensions to a boiling point, particularly with ongoing security crises and political boycotts complicating the formal process. On the eve of the forum, the Tigray Regional State officially foreswore participation, calling it an isolated and unacceptable exercise and citing the federal government’s failure to fully implement the Pretoria Peace Agreement. Meanwhile, other opposition figures warned of dire consequences if a way cannot be found to incorporate armed groups fighting in the Oromia and Amhara regional states into the dialogue.

In these intense battlegrounds, the state machinery, formal and bureaucratic, is brought to a grinding halt at checkpoints and through political gridlock. Where the state cannot enter, traditional elders and religious authorities can step ahead of it. Because they have personal, cross-cutting ties that cut across ethnic and political lines, they are equipped to fill the gap, broker local ceasefires, facilitate safe passage for negotiators, and safeguard the prospect of dialogue when the state is locked out.

In fact, on some of the most productive and unheralded occasions so far, commissioners have achieved breakthroughs precisely when they, as government officials, have allowed themselves to act as mediators. In a number of regional consultations where discussions of difficult topics such as internal borders or historical injustices began to spiral out of control, the commission simply set aside the conference hall’s formal rules. Instead, it spoke with people in informal circles and allowed local elders, and sometimes traditional diviners, to use conventional consensus-building tactics to calm the antagonists. At that point, the commission, like its great-grandfather the honorable mediator, became an otherworldly receptacle for ancestral wisdom.

In the end, this dialogue will not be judged by how swiftly it can absorb its 4,000 delegates, or by the weight of the final report it puts before Parliament this fall. It will be judged by the degree of consensus it generates and the level of trust it engenders among ordinary citizens. If it merely becomes a technical, top-down, exclusionary exercise that leaves out important regional constituencies, it will produce nothing more than a handsome tome that can gather dust on a shelf while life goes on as usual. But by incorporating its traditional customary fabric into the state’s sacred tapestry, Ethiopia has a unique opportunity to demonstrate to the world a new model of building peace, one that underscores that a modern state cannot merely rely on designing institutions; it must be rooted in the civic foundations of the cultures of its people.

The Political Economy of Leverage in Making Business

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In todays business world leverage is a powerful tool that helps companies grow and succeed. Leverage is not about borrowing money to make more money. It is also about having influence over the government getting treatment having the latest technology and being part of important networks. Companies that are good at using these types of leverage are more likely to succeed. To understand how businesses are created and grow we need to look at how the market the government and power relationships work

The traditional way of thinking about business says that leverage is mainly about borrowing money. Companies borrow money to invest grow and make their shareholders happy. Some economists like Modigliani and Miller said that in a market it does not matter if a company borrows money or not.. In the real world things are not perfect. There are taxes people do not have all the information they need. There are rules that companies have to follow. This means that borrowing money can be a factor in determining which companies are successful. Borrowing money can help companies grow quickly. It can also make them unstable if they borrow too much. We saw this happen during the financial crisis in 2008.

If we look at business from an economy perspective we can see that not all companies have the same access to leverage. Big companies have power because the government needs their investments, jobs and taxes. This creates a relationship where big companies can influence government policies to help themselves. For example big companies often lobby the government for tax breaks, subsidies and favorable rules. This is what Lindblom called the ” position of business” in capitalist societies. The government is often hesitant to make rules that might scare away investors.

he big technology companies like Google, Amazon and Meta are an example of this. They have a lot of power not because of their money but also because they control a lot of data, digital infrastructure and networks. This makes it hard for other companies to compete with them. They can also influence the rules that are made about things like privacy, competition and taxes. This is an example of how leverage can be used to gain power and influence.

Some people argue that this concentration of leverage is bad for competition and democracy. Piketty said that capitalism naturally leads to a concentration of wealth which gives some people power and influence. When wealth is concentrated companies with a lot of leverage can use it to get more power and influence. This makes it hard for smaller companies and startups to compete. Financial leverage can also create risks. The financial crisis in 2008 showed us what can happen when companies borrow much money.

However leverage is not all bad. If it is regulated properly it can help entrepreneurship, innovation and economic growth. When small businesses have access to credit they can invest in technologies create jobs and contribute to the economy. Development economists have long said that access to credit is essential for development. Governments can also use policies to make sure that everyone has access to leverage. Public development banks, credit guarantees and targeted subsidies can help reduce market failures and support industries.

To make this work we need good governance. We need institutions that can balance the need to help businesses grow with the need to prevent them from getting too powerful. We need rules to prevent monopolies regulate finance and make sure that companies are transparent. We also need to regulate the ways that companies try to influence the government. If we can do this leverage can be a tool for creating prosperity that is shared by everyone. The rise of social and governance frameworks shows that people are starting to expect more from businesses. Companies are no longer just judged on how money they make but also on their impact on society and the environment.

In the end leverage is a part of the political economy of business. While financial leverage is still important for companies to grow and compete other types of leverage like influence, technological dominance and institutional power are also crucial. The way that leverage is distributed is a matter of power relationships between companies, the government and society. If we do not regulate leverage it can lead to inequality, undermine competition and threaten democracy.. If we govern it well it can help create innovation, entrepreneurship and economic growth. The challenge, for policymakers is to make sure that the benefits of leverage are shared fairly by everyone.

Climate change isn’t taking food off your table

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No morning ritual is safe from climate alarm. The journal Nature just declared that coffee is “critically threatened by climate change” and described scientists racing to save your espresso from “extinction.” The New York Times blames sky-high coffee prices on climate-driven supply crunches in Brazil and Vietnam. And your olive oil? CNN and Bloomberg wail about a seemingly permanent “crisis,” with Mediterranean droughts foretelling a future in which an everyday staple vanishes for good.

The message is unmistakable: Global warming is coming for your family’s dinner table, and only sweeping climate policy can save it. The message is also wrong. Cut through the hype, and food is not only more plentiful, but its inflation-adjusted cost is near historic lows relative to any time since 1900.

Start with coffee, supposedly on its deathbed. This year, global coffee production is expected to set yet another record — more than double the world’s output of 50 years ago. Crops on the brink of extinction don’t deliver record harvests. And despite recent price bumps, the real price of coffee has trended downward since 1960. Adjusted for inflation, coffee this century has cost on average half of what it cost in the last century.

How do outlets like the New York Times get it so wrong? By inexcusably ignoring inflation — comparing coffee prices from the 1970s, expressed in the dollars of that day, with prices expressed in today’s dollars. By that standard, everything is at a record high, always.

Even Nature‘s own reporting on coffee undercuts its ominous headline detailing “how scientists are fighting to save it from extinction.” Ethiopia keeps more than 12,000 arabica plants in living gene banks for breeding heat- and drought-tolerant varieties. “I believe we have enough gene pool to fight climate change,” the Ethiopian plant geneticist leading the effort says. Farmers in hotter regions are already switching to hardier coffee species that professional tasters can’t distinguish from fine arabica. That isn’t extinction. It is what agriculture has always been: adaptation and improvement.

The supposed olive-oil crisis collapses under the same scrutiny. According to United Nations’ food statistics, global olive-oil production has tripled since 1961 and doubled since 1990. Last year and this year, together with the exceptional 2018 harvest, mark all-time high record highs for production of olive oil. Meanwhile, inflation-adjusted prices have not increased and have even slightly declined since 1990. Again, better farming and expanded cultivation outweigh any climate effect.

Food scare stories follow a formula: Take an isolated weather event, attribute it to global warming, skip inflation adjustment and ignore the long-term data. Natural year-to-year swings driven by economics, trade policy and subsidies get repackaged as apocalyptic trends. Rarely mentioned: Much of the real price pressure on food comes from fertilizer and transport costs—inflated, ironically, by climate policies that raise fossil fuel energy bills for the essentials of farming.

Never mentioned: the ways climate change helps crops. Carbon dioxide is plant food, which is why commercial growers pump extra CO2 into greenhouses to produce more tomatoes. NASA satellites show that the planet has been greening for four decades, meaning the world has added additional leaves with an area equivalent to that of at least two times the Amazon rainforest.

Climate change will, on balance, hurt agriculture. But its impact is dwarfed by rising productivity. One highly cited study in Nature finds that without any climate change, global food-calorie production will increase 51% between 2010 and 2050. With extreme, unrealistic warming, it still increases by 49%. Across all models and scenarios, the difference in calories available per person amounts to one-tenth of 1%.

That’s because humanity keeps getting better at growing food. Cereal production has more than quintupled over the past century while real food prices have more than halved. The Green Revolution of the 1960s turned famine-prone nations into exporters through the widespread adoption of high-yield crop varieties, alongside expanded use of chemical fertilizers and improved irrigation. India, once written off as a basket case dependent on food aid, quadrupled its rice production between 1961 and 2023 and is today the world’s largest rice exporter. Daily calorie availability per person has climbed from less than 2,200 in 1961 to more than 2,900 now. Global undernourishment has plummeted from roughly one in four people in the developing world in the early 1990s to fewer than 10% today.

The task now is to finish the job. Innovation should extend to under-researched crops like sorghum, cassava and millet — staples for two billion people in the developing world that have been largely ignored by commercial breeders. Investment in biotech, precision agriculture and drought-resistant crop varieties will do far more for the world’s poor — and for your grocery bill—than any emissions target.

We can keep feeding more people, better, by doubling down on what actually works: innovation.